A  THREE  YEARS'  STRUGGLE 

WITH 

MUNICIPAL  MISRULE. 

RE] 

>  O  11  T 

ANDREW 

OF 

H.  GREEN. 

COMF 

fROLLER, 

IN 

RESPONSE  TO  CEI 

v  T  A I N  RESOLUTIONS 

■ 

BOARD  OF 

>F  THE 

ALDERMEN, 

■ 

FEBRUARY   18,  1875. 

iEx  ICthrta 


SEYMOUR  DURST 


When  you  leave,  please  leave  this  hook 

Because  it  has  heen  said 
"Ever  thing  comes  t'  him  who  waits 

Except  a  loaned  hook." 


AVI-.RY  AR(  III  II  ('II  RAI  AND  l  lM  AR  I  S  LlHRAI^ 

(ill  i  in  Si  ymoi  r  R.  Dirsi  ()i  n  York  Library 


A  THREE  YEARS'  STRUGGLE 

WITH 

MUNICIPAL  MISRULE. 


EEPOET 

or 

ANDREW  H.  GREEN, 

COMPTROLLER, 

IN 

RESPONSE  TO   CERTAIN  RESOLUTIONS 

OF  THE 

BOARD  OF  ALDERMEN, 
FEBRUARY  18.  1875. 


fft 


City  of  New  York — Department  of  Finance, 
Comptroller's  Office, 

February  18,  1875. 

To  the  Honorable  the  Board  of  Aldermen  of  the  City  of  New  York  : 

In  accordance  with  the  following  resolution  adopted  by  your 
Honorable  Body,  January  14,  1875  : 

Resolved,  That  the  Comptroller  be  and  he  is  hereby  directed  to 
report  to  this  Board,  within  a  period  of  thirty  days,  or  at  the  next 
meeting  of  the  Board  thereafter,  a  statement  in  detail,  showing  : 

1.  The  amount  of  the  indebtedness  of  the  City. 

2.  The  amount  of  receipts  from  all  sources  during  the  past  year, 
including  the  unexpended  balances  of  former  years ;  the  interest  on 
unpaid  taxes  and  assessments  ;  and  the  interest,  if  any,  paid  upon  the 
deposits  of  the  City. 

3.  The  expenditures  for  the  past  year. 

4.  The  claims  in  his  office  against  the  City,  unadjusted. 

5.  The  amount  of  the  judgments  obtained  against  the  City  during 
his  term  of  office,  with  the  costs  taxed  upon  the  City. 

6.  The  amount  saved  to  the  City  by  litigation  during  the  same 
period  by  decisions  in  its  favor. 

7.  The  amount  of  the  bonds  and  stocks  of  the  Ci.y,  created  by 
authority  of  the  State  Legislature,  and  not  asked  for  or  approved  by 
the  Common  Council  or  the  Board  of  Supervisors,  and  the  amount 
approved  or  asked  for  by  the  corporate  authorities  of  this  City  and  the 
late  County  authorities,  respectively. 


4 


8.  The  amount  of  unpaid  taxes  and  assessments  up  to  December 
31,  1874,  and  the  amount  of  assessment  bonds  outstanding  at  the 
same  date  ;  and 

9.  A  balance  sheet  showing  the  financial  position  of  the  City  at 
the  close  of  the  past  year. 

I  have  the  honor  to  report  under  each  head  of  inquiry,  as  follows  : 

I. — The  Amount  of  the  Indebtedness  of  the  City. 
The  bonded  debt  as  it  existed  December  31,  1874,  was 


Funded  debt,  payable  from  Taxation  and  Sinking  Fund   $118,241,557  24 

Assessment  bonds,  payable  wholly  or  in  part  from  Assessments.. .  .  20,851,000  00 

Bonds  payable  from  building  lien   3,700  76 

Revenue  bonds  of  1874   2,707,500  00 

Total   $141,803,758  00 

Less  securities  held  by  the  Sinking  Fund   26,615,778  00 

Total  net  bonded  indebtedness   $115,187,980  00 


In  addition  to  the  securities  held  by  the  Sinking  Fund,  there  was 
cash  in  the  treasury  to  its  credit  for  the  redemption  of  the  City  debt, 
December  31,  1874,  $208,010.01.  And  also  bonds  and  mortgages 
applicable,  when  collected,  to  the  same  purpose,  $710,106.67. 

Schedule  "  A,"  accompanying  this  report,  shows  the  full  details  of 
this  debt,  rate  of  interest,  date  when  due,  amount  and  name  of  each 
stock  or  bond. 

The  increase  of  the  bonded  debt  in  the  three  years,  1869,  1870, 
and  1 87 1,  is  as  follows  : 

The  bonded  debt,  December  31,  1S68,  was          $52,205,430  So  Showing  an  increase  of 


"                 11            1869,  was             66,040,052  22  $13,834,621  42 

"                 "             1870,  was            91,489,44651  25,449,39429 

"  u  1871,  was....  108,551,70851  17,062,26200 
Gross  increase  from  December  31,  1S68,  to  December  31, 

1S71,  three  years.of   $56»34<>,277  7» 


5 


The  increase  of  the  bonded  debt  in  three  years,  since  the  accession 
of  the  present  Comptroller  to  office,  1872,  1873,  and  1874,  is  as  fol- 
lows : 

The  bonded  debt,  December  31,  1871,  was  $108,551,708  51  Showing  an  increase  of 

"  "  1872,  was   118,815,22982      $10,263,521  31 

"  "  1873,  was   131.204,571  22        12,389,341  40 

"  "  1874,  was   141,803,75800  10,599,18678 

Gross  increase  from  December  31,  1871,  to  December  31, 

1874,  three  years,  of.   $33,252,049  49 

The  old  claims  and  liabilities  existing  when  the  present  Comp- 
troller took  office,  and  the  extraordinary  demand  on  account  of  the 
deficiency  in  the  State  Sinking  Fund,  which  have  been  paid  from  the 
proceeds  of  bonds,  and  the  money  since  paid  by  him  for  Boulevard 
and  other  Up-town  improvements,  aggregate  more  than  the  whole 
increase  of  the  bonded  debt  of  the  City  during  the  present  adminis- 
tration of  the  Finance  Department. 

It  is  idle  to  expect  any  diminution  of  the  debt  while  officers  of  the 
government,  having  almost  unlimited  power  to  contract  debt,  are 
steadily  urging  its  increase  for  carrying  on  a  class  of  works  a  genera- 
tion in  advance  of  any  public  need  for  them.  The  Comptroller  is 
required,  by  laws  imperative  in  their  character,  to  raise  money  on  the 
credit  of  the  City  to  pay  the  cost  of  carrying  on  these  works,  and  he 
has  repeatedly  asked  for  the  repeal  or  modification  of  powers  under 
which  the  Department  of  Public  Works  is  now,  and  has  for  three  years, 
been  expending  enormous  sums  of  money. 

The  remarks  under  this  head  of  inquiry  refer  to  the  bonded  debt ; 
the  unsettled  and  unliquidated  floating  debt  will  be  considered  under 
the  fourth  head,  "  Unadjusted  Claims." 

Besides  the  above-stated  amount  of  bonded  debt  of  the  City,  there 
is  an  indebtedness,  as  far  as  already  ascertained,  of  over  a  million  and 
a  half  dollars,  consisting  of  the  bonded  debts  of  the  late  towns  of 
West  Farms,  Morrisania,  and  Kingsbridge,  lately  annexed  to  this  City. 
Schedule  "  A "  also  contains  a  detailed  statement  of  this  bonded 


6 


debt,  showing  the  amounts  and  objects  of  the  issues  of  bonds  of  each 
town,  and  the  principal  which  became  due  and  was  paid  off  by  the 
City  in  1874. 

The  work  of  ascertaining  this  debt  has  been  difficult  and  pro- 
tracted, and  is  not  yet  concluded,  as  many  claims  and  accounts  are 
uncertain  and  confused  in  their  character,  and  the  evidence  of  them 
very  unsatisfactory.  Before  a  final  determination  and  settlement  of 
the  debts  and  obligations  of  this  territory  can  be  made,  legislative 
enactments  are  required  to  explain  doubtful  provisions  in  the  acts  of 
annexation. 

II.  — The  Amount  of  Receipts  from  all  sources  during  the  past 
Year,  Including  the  Unexpended  Balances  of  former  Years  ;  the 
Interest  on  Unpaid  Taxes  and  Assessments  ;  and  the  Interest,  if 
any,  paid  upon  the  deposits  of  the  clty. 

III.  — The  Expenditures  for  the  Past  Year. 

The  operations  of  the  Finance  Department  under  these  two  heads 
are  presented  together,  and  the  following  is  a  general  summary  of  the 
amounts  of  receipts  and  expenditures  of  the  Treasury  and  of  the  Sink- 
ing Fund  in  1874,  from  all  sources,  and  the  balances  in  cash  at  the 
beginning  and  end  of  the  year  : 

operations  and  state  of  the  treasury  in  1874. 

The  amount  of  money  in  the  City  Treasury,  December  31,  1S73,  was  $645,105  40 
The  receipts  into  the  Treasury,  from  all  sources,  during  the  year 

1874,  was   96.985^45  78 


$97,630,651  18 


The  amount  of  warrants  on  the  Treasury,  paid  by  the  Chamberlain 
in  1874,  was  


96,146,364  56 


balance  remaining  in  the  Treasury  December  31,  1874 


$1,484,286  62 


Schedule  "B"  shows  the  different  sources  of  revenue  for  1874, 
and  the  amount  received  from  each,  including  the  receipts  or  interest 


7 


on  taxes  and  assessments,  and  the  amounts  of  interest  received  upon 
deposits  of  the  City  moneys. 


The  revenues  from  these  sources  since  1870  were  : 


Interest  on— 

1870. 

1871. 

1872. 

1873- 

1874. 

Taxes  

Assessments  

$361,412  94 
128,788  46 
75.495  94 

$530,386  47 
263,750  96 
105,362  81 

$406,608  75 

173,028  38 
* 

$443,555  89 
225,537  21 
t79,992  72 

$886,511  47 
658,821  79 
118,654  95 

*  Nothing  paid  by  Chamberlain  Palmer. 

t  Nothing  paid  in  by  Chamberlain  Palmer  during  four  months. 


Schedule  "B"  also  shows  the  expenditures  made  during  the  year 
1874,  under  each  account  to  which  they  belong;  and  for  items  in 
detail  reference  is  made .  to  the  quarterly  reports  rendered  to  the 
Mayor,  which  exhibit  the  name  and  object  of  every  warrant  drawn  on 
the  Treasury. 

Schedule  "B"  also  exhibits  the  appropriations  for  1874,  the  unex- 
pended balances  of  former  years,  the  amount  expended  under  each 
appropriation,  and  the  balances  remaining  unexpended  December  31, 


1874,  aggregating  under  each  head,  as  follows  : 

Balances  of  appropriations  for  1873  an(l  previous  years   $4,613,381  07 

Appropriations  for  1874   34,872,391  79 

Total   $39,485,772  86 

Amount  expended  under  appropriations  in  1874,  for  which  warrants 

have  been  drawn   36,526,488  38 

Balances  of  appropriations  unexpended  December  31,  1874   $2,959,284  48 


In  this  connection  it  should  be  noted  that  although  the  appropria- 
tions of  former  years  are  not  wholly  expended,  there  is  a  large  defi- 
ciency in  the  product  of  personal  taxes,  which  renders  the  means  of 
the  Treasury  inadequate  to  meet  those  appropriations. 


8 


IV. — The  Claims  in  the  Comptroller's  Office  Against  the  City 

Unadjusted. 

Schedule  "  C  "  shows  in  detail  the  unadjusted  claims  in  the  Comp- 
troller's office  against  the  City  of  New  York,  as  completely  as  the  files 
of  the  office  permit,  without  reference  to  the  legality  of  the  claims,  and 
includes  unsettled  accounts  and  demands  accumulated  for  years. 

As  it  is  made  up,  as  asked  for,  to  December  31,  1874,  it  embraces 
many  current  and  unobjectionable  claims  which  have  been  settled  and 
paid  since  that  date,  as  settlements  and  adjustments  are  made  daily. 

The  following  is"  a  summary  of  this  class  °f  unadjusted  claims, 
amounting  in  the  aggregate  to  $6,971,149.48; 

SUMMARY. 

Amount  of  unadjusted  advertising  claims  of  1 87 1,  and  prior  thereto, 
presented  to  the  Board  of  Audit  and  Apportionment,  but  not 

acted  upon  by  that  Board   $896,458  64 

Amount  of  Miscellaneous  Claims  against  the  City  and  County  of  New 
York,  also  presented  to  the  Board  of  Audit  and  Apportionment, 

but  not  acted  upon  by  that  Board   172,866  83 

Amount  of  unadjusted  claims  against  the  Department  of  Public  Works  324,254  68 

"                      "                  "                  "           Docks   106,626  82 

«'                     "                 M                 "          Public  Parks.  76,668  54 

Amount  of  unadjusted  claims  against  the  Department  of  Public  Chari- 
ties and  Correction   29,26675 

Amount  of  unadjusted  claims  against  the  Department  of  Public  In-  • 

struction   42,820  02 

Amount  of  unadjusted  claims  against  the  Fire  Department   ir>449  67 

"                 ,l           M              "     Health  Department   1,69878 

"                  "           l<              "      Department  of  Buildings  ..  .  925  OO 

Amount  of  unadjusted  Miscellaneous  claims  against  the  City  of  New 

York     2,7S7,m  32 

Amount  of  unadjusted  claims  for  Taxed  Costs  in  Street  Opening  cases  602,503  9S 

M                 "          "         Awards  for  Street  Openings   1,746,40034 

Amount  of  unadjusted  claims  of  Municipal  Policemen  for  services 
between  the  16th  day  of  June,  1857,  and  the  10th  day  of  April, 

i860   172,098  II 

Total  unadjusted  claims,  December  31,  1874   $6,971,149  4S 


9 


The  old  unliquidated  claims  have  been  improperly  spoken  of  as 
so  much  City  debt,  whereas  many  of  them  are  exorbitant  or  fraudu- 
lent, or  wholly  fictitious,  and  not  to  be  considered  as  indebtedness  of 
the  City  except,  perhaps,  to  a  comparatively  limited  amount.  Con- 
tinued and  determined  resistance  to  them  by  the  accounting  and  law 
officers  of  the  City  will  protect  the  Treasury  and  greatly  lessen  dis- 
bursements on  their  account. 

The  Comptroller  would  not  recognize  many  of  them,  even  by 
stating  them,  were  it  not  that  the  Mayor  and  the  Board  of  Aldermen 
seem  to  desire  that  they  should  be  recapitulated  and"  stated  in  detail. 
The  effect  of  the  schedule  herewith  submitted  may  be  to  stimulate  and 
incite  claimants  to  renewed  attacks  upon  the  Treasury,  and  more 
strenuous  efforts  in  behalf  of  their  schemes.  The  Comptroller  protests 
against  this  recital  of  them  being  tortured  or  twisted  into  any,  even  the 
faintest,  recognition  of  their  validity. 

The  debt-contracting  power  was,  under  the  late  regime,  exercised 
indiscriminately  by  all  branches  of  the  City  and  County  Government. 
Little  or  no  regard  was  paid  to  the  positive  prohibitory  provisions 
against  expenditures  in  excess  of  authorized  appropriations,  and  the 
natural  result  was  an  annual  spawning  of  a  mass  of  illegal  claims,  to 
be  settled  as  best  they  might.  Nearly  every  Department  had  its  own 
Treasury,  paid  such  bills  as  it  chose,  and  acted  without  restraint, 
responsibility,  or  accountability.  Annual  expenses  increased  enor-v 
mously,  floating  debt  accumulated,  and  all  kinds  of  obligations  were 
increased,  which  now  exist  in  the  form  of  unadjusted  claims.  The 
following  list  of  Departments,  Boards,  Commissioners,  and  branches 
of  the  City  and  County  Government  which  incurred  expense  and  con- 
tracted debt,  strikingly  shows  the  extent  and  capacity  of  the  debt- 
contracting  power.  How  effectively  and  disastrously  its  energies  were 
put  at  work,  is  shown  by  the  magnitude  of  the  unsettled  claims  left  by 
them  : 

1.  The  Board  of  Supervisors. 

2.  The  Common  Council. 


IO 


3.  The  Police  Department. 

4.  The  Finance  Department. 

5.  The  Department  of  Public  Works. 

6.  The  Department  of  Public  Charities  and  Correction. 

7.  The  Fire  Department. 

8.  The  Health  Department. 

9.  The  Department  of  Public  Parks. 

10.  The  Department  of  Buildings. 

11.  The  Department  of  Docks. 

12.  The  Department  of  Public  Instruction. 

13  to  34.  Each  of  the  twenty-two  Ward  Boards  of  Trustees  and 
Inspectors  of  Schools. 

35.  The  Department  of  Taxes  and  Assessments. 

36.  The  Commission  for  erecting  New  County  Court-house. 

37.  The  Commission  for  erecting  the  Third  District  Court-house. 

38.  The  Commission  for  erecting  the  Ninth  District  Court-house. 

39.  The  Commission  for  erecting  the  Eighteenth  Ward  Market. 

40.  The  Street  Cleaning  Commission. 

41  to  80.  Forty  Commissions  for  Opening  Streets. 

In  all  eighty  separate  and  distinct  Boards  or  Departments. 

Expenses  were  incurred  and  claims  manufactured  by  these  various 
authorities  often  without  proper  restraints. 

Orderly  official  records  of  obligations  incurred  by  them  do  not 
exist.  In  some  cases  no  record  whatever  exists.  The  changes  that 
have  occurred  in  the  personnel  of  these  bodies  in  the  last  three  years 
make  it  exceedingly  difficult,  if  not  impossible,  to  trace  the  extent  of 
the  debts  they  have  created.  Many  of  those  who  administered  public 
affairs  three  years  ago  have  absconded  from  the  country,  while  others 
are  reluctant  to  state  their  operations  for  fear  of  involving  themselves 
or  their  allies.    Claims  for  services  or  supplies  which  were  probably 


II 


never  performed  or  furnished,  are  often  presented  without  the  slightest 
evidence  of  their  validity,  or  bearing  only  a  semi-official  authentication, 
by  some  suspected  or  untrustworthy  officer. 

The  Finance  Department  for  the  last  three  years  has  been  con- 
stantly embarrassed  by  want  of  official  co-operation  in  the  adjustment 
of  claims  against  the  City,  and  a  vast  amount  of  labor  has  conse- 
quently been  imposed  upon  it. 

The  general  character  of  hundreds  of  claims  with  which  the 
Finance  Department  has  to  deal  may  be  illustrated  by  a  brief  reference 
to  a  few  examples  : 

1.  Claim  amounting  with  interest  to  nearly  $1,000,000,  for  water- 
meters,  not  used,  but  alleged  to  have  been  furnished  to  the  City  under 
a  special  contract  with  William  M.  Tweed,  Commissioner  of  Public 
Works,  at  most  exorbitant  rates.  It  is  but  a  fragment  of  a  scheme 
comprehending  certain  public  and  private  persons,  which  was  to 
eventuate  in  furnishing  water-meters  all  over  the  City,  for  which  the 
City  was  primarily  to  pay,  and  take  its  chances  to  collect  back  from 
tenants  and  owners.  The  legislation  was  obtained  in  187 1,  upon 
which  to  found  this  monstrous  job,  and  still  remains  upon  the  Statute 
book.    A  suit  is  now  pending  to  recover  this  claim. 

2.  Claims  of  Edmund  Jones  and  William  C.  Rogers  &  Co., 
amounting  to  $1,125,610.27,  for  printing  and  stationery,  said  to  have 
been  furnished  in  1868,  1869,  1870  and  187 1.  During  the  same 
period,  the  same  parties  were  paid  nearly  one  million  dollars  for  the 
same  kind  of  supplies.  This  claim,  with  the  amount  already  paid  to 
the  same  parties,  would  make  more  than  two  million  dollars.  Others 
also  supplied  stationery  at  the  same  time. 

These  parties  are  prosecuting  these  claims  also. 

3.  Charles  Devlin,  assignee  of  John  McCauley,  for  constructing 
sewer  in  Seventh  avenue,  amounting  to  $112,000,  arose  under  a 
special  contract  made  with  the  present  Department  of  Public  Works  at 
exorbitant  prices. 


12 


4.  Charles  Devlin  and  others,  for  unearned  or  prospective  profits 
on  the  old  Hackley  street  cleaning  contract,  amounting  to  $800,000. 
Judgment  was  obtained  against  the  City  on  this  claim  in  July,  1873, 
for  nearly  half  a  million  dollars,  after  nine  years'  litigation.  An  appeal 
was  taken,  and  special  counsel  employed  to  defend  the  rights  of  the 
City,  and  in  January,  1875,  the  judgment  of  the  Court  below  was 
reversed  and  set  aside  at  General  Term,  and  judgment  absolute  ren- 
dered in  favor  of  the  City  with  costs. 

5.  The  claim  of  John  H.  Starin,  Assignee  of  William  McKeag, 
amounting  to  $453,800,  for  alleged  services  as  lawyer  in  prosecuting 
suits  for  violation  of  the  Excise  Laws,  between  the  years  1857  and 
1 87 1.  This  claim  is  one  of  a  large  class  dating  back  for  twenty  or 
more  years. 

6.  Claim  of  J.  G.  Bennett  for  advertising,  alleged  to  have  been 
done  in  the  New  York  Herald  and  Telegram,  originally  amounting  to 
more  than  $72,000.  This  claim- came  up  for  payment.  On  examina- 
tion it  was  found  to  be  overcharged  and  subject  to  large  deductions,  a 
particularly  flagrant  item  being  a  charge  of  $18,398  for  printing  one 
of  Mayor  Hall's  messages.  This  was  published  as  reading  matter,  and 
perused  by  the  public  as  news,  but  was  really  charged  for  as  advertis- 
ing at  one  dollar  a  line.  The  highest  ordinary  rate  of  the  Herald  for 
advertising  was  forty  cents  per  line. 

The  bills  were  accordingly  reduced  from  the  original  figures  to 
about  $47,000,  and  the  allowance  was  promptly  accepted  by  Bennett, 
and  a  receipt  in  full  given.  Six  months  after  this  settlement  and 
receipt  in  full,  Bennett  is  found  in  the  Courts,  claiming  that  the  pay- 
ment fur  which  he  had  receipted  in  full  was  only  on  account,  and 
demanding  payment  of  the  balance. 

7.  Claim  of  James  Walker  Fowler,  Justice  of  the  Third  Judicial 
District  Court.  Although  the  charter  expressly  regulates  anil  fixes  the 
compensation  of  the  justices  of  those  Courts  at  $8,000  per  annum,  in 


13 


payment  of  which  a  monthly  warrant  is  regularly  drawn,  Fowler 
claims  a  salary  of  $10,000,  under  an  old  repealed  provision  of  law,  and 
has  brought  several  suits  against  the  City. 

Certain  transactions  of  Mr.  Fowler,  when  he  was  in  the  employ  of 
the  Surrogate,  were  successfully  interposed  in  one  Court  in  one  pro- 
ceeding for  his  salary,  but  another  Court  ruled  them  out. 

Another  class  of  claims,  though  each  small  in  amount,  and  dating 
back  many  years,  is  so  great  in  number  as  to  form  a  large  total,  such 
as  the  demands  of  political  partisans  and  strikers,  claiming  to  have 
been  employed  as  attendants  and  officers  of  the  courts,  and  incumbents 
of  various  sinecure  places,  as  inspectors,  market-sweepers,  axe-men, 
lamp-painters,  water-police,  court  janitors,  and  other  places  invented 
to  reward  inferior  political  ward-operators. 

There  are  to-day  three  janitors  in  one  court-building  in  this  City, 
•each  claiming  his  appointment  from  a  different  source,  and  each  claim- 
ing his  pay  from  the  City.  One  person  is  entirely  sufficient  to  perform 
the  service.    This  is  what  is  called  patronage. 

Under  the  British  Government  offices  have  not  unfrequently  been 
constituted,  and  certain  privileges,  fees,  and  emoluments  attached 
thereto,  as  a  reward  for  distinguished  civil  and  military  service.  The 
beneficiaries  of  these  offices  often  become  distinguished  personages  in 
the  State,  enjoying  their  dignities  and  receiving  the  revenues,  as  it 
were,  in  lieu  of  a  pension.  In  the  course  of  centuries,  questions  arose 
in  the  courts  as  to  their  right  to  these  emoluments,  and  the  principle 
was  laid  down,  that  the  holder  of  an  office  of  this  character  need  not 
render  any  contemporaneous  service  whatever.  He  had  already  ren- 
dered the  service,  and  was  entitled  to  the  reward. 

In  these  latter  times,  and  in  this  City,  it  appears  that  the  wide  dis- 
tinction in  the  circumstances  has  not  been  sufficiently  recognized,  the 
English  precedents  have  been  drawn  into  the  support  of  the  principle 
that  an  officer  or  place-holder  is  entitled  to  the  salary  while  he  holds 


14 


the  place,  whether  he  renders  any  service  or  not ;  and  this  rale  has 
been  applied  to  the  pettiest  places  about  the  City  Government,  and  has 
sustained  and  upheld  sinecures  on  a  principle  that  has  no  applica- 
bility. 

It  is  difficult  for  jurors  to  see  why  they  should,  at  the  direction  of  a 
court,  give  a  verdict  against  the  City  to  a  scavenger,  or  janitor  or  court 
attendant,  or  record  translator,  who  has  done  no  service,  simply  be- 
cause some  pensioner,  a  century  or  more  since,  could  hold  a  sinecure 
under  the  British  Crown,  as  a  reward  for  high  services  rendered. 

Section  97  of  the  Charter  of  1873  provides  that — 

"  The  salaries  of  all  officers  paid  from  the  City  Treasury  * 
*       *      shall  be  fixed  by  the  Board  of  Apportionment." 

Under  this  provision  the  salaries  of  the  janitors  of  Court,  of  whom 
there  are  fifteen  or  more,  were  reduced  by  the  Board  of  Apportionment, 
when  Mayor  Havemeyer  was  a  member,  from  $1,500  to  $1,200  per 
annum,  and  the  Comptroller  paid  that  amount.  Shortly  after,  however, 
suits  were  commenced  to  recover  the  difference  of  $300  per  annum. 
The  Courts  gave  judgment  in  favor  of  the  janitors,  on  the  ground  that 
they  were  not  officers,  and  therefore  the  Board  of  Apportionment  could 
not  fix  their  salaries. 

Who  that  knows  the  history  of  this  legislation,  and  the  inequalities 
of  salaries  existing  in  the  City,  can  doubt  that  the  word  "  officers,"  as 
used  in  the  Charter  by  its  inartificial  draughtsmen,  meant  "  employees  ?" 
It  has  become  as  much  the  popular  habit  to  call  a  janitor  or  a  court 
attendant  an  "  officer,"  as  it  is  to  designate  the  Mayor  of  the  City  by 
that  title. 

Schedule  "C"  also  contains  a  statement  of  claims  for  the  taxed 
costs  in  street-opening  cases,  which  amount  in  the  aggregate  to 
$602,503.98.    The  following  are  the  names  of  some  of  the  persons 


15 


representing  this  class  of  claims,  which  are  so  grossly  disproportionate 
to  the  alleged  services  rendered,  viz. : 


Names  of  Parties. 

Amount  paid 
during  years 
I ouo-io i z. 

Amount 
now  claimed. 

Total  paid  for 
1 868- 1 872,  and 
now  claimed. 

«IPI32>055  5° 

*I3I»9I9  °5 

$263,977  55 

/,789  19 

14,474  06 

302,263  25 

John  A.  Bagley  

8l,723  56 

202,115  26 

283,838  82 

67,426  68 

11,612  78 

79,039  46 

18,155  14 

4,000  00 

22,155  14 

26,420  00 

10,000  00 

36,420  00 

10,080  00 

10,000  00 

20,080  00 

W.  C.  Rogers  &  Co  

51.592  5o 

23,461  86 

75,054  36 

J.  Walker  Fowler  

1,570  00 

1,570  00 

The  immense  charges  formerly  put  upon  the  City  and  property- 
holders,  by  extravagant  "  Taxed  Costs,"  in  street-opening  cases,  has 
been  greatly  reduced  in  recent  proceedings  through  the  opposition 
interposed  to  their  payment;  still  further  reduction  should,  however, 
be  effected.  The  Comptroller  is  of  the  opinion  that  the  requirements 
of  the  Law  of  1862,  framed  for  the  reduction  of  these  expenses,  are 
rarely  complied  with. 

In  the  same  schedule  are  found  claims  for  Ring  advertising  yet 
unadjusted,  and  aggregating  $896,458.64. 

Prominent  among  these  is  the  advertising  claim  presented  by  the 
Commercial  Advertiser  newspaper  for  $89,147.80.  An  examination  of 
this  claim  developed  the  fact  that  of  this  amount  more  than  $35,000 
had  been  previously  paid  to,  and  receipts  taken  from,  Mr.  Hugh  J. 
Hastings.  Certain  overcharges  were  also  discovered,  amounting  to 
$36,000,  and  items  for  which  no  authority  existed,  amounting  to 
$3,500,  reducing  the  amount  originally  claimed  from  $89,147.80  to 
about  $13,000.  This  is  another  of  the  claims  on  which  suit  has  been 
commenced. 


16 


The  notorious  M.  L.  Hankin's  claim,  for  alleged  advertising  in 
three  obscure  papers,  comes  next  in  order.  These  papers  were  almost 
unknown  and  without  circulation.  The  claims  amount  to  upwards  of 
$365,000,  and  are  believed  to  have  no  merit  whatever. 

No  claims,  perhaps,  were,  as  a  class,  more  audaciously  fraudulent 
and  disgraceful  than  those  for  newspaper  advertising  during  the  Ring 
administration.  The  "  Transcript  Association  "  alone  was  paid 
$783,498.09,  and  an  unadjusted  claim  of  this  concern  is  now  presented 
for  $186,160.20. 

The  moneys  actually  paid  for  advertising  during  the  three  years, 

1869,  1870,  and  187 1,  were   $2,586,477  00 

Total  outlay  for  the  three  years  following  that  period,  1872,  1873, 

and  1874,  including  the  cost  of  the  City  Record,  is.. .... .  212,438  37 

Showing  a  decrease  in  this  class  of  expenditures  during  the  present 

Comptroller's  administration  of.   $2,374,038  63 

— being  a  reduction  or  saving  of  over  ninety-one  per  cent. 

In  the  same  schedule  are  also  included  seventy-four  claims  of  Mayor 
Fernando  Wood's  municipal  policemen,  who  were  involved  in  the  con- 
test in  1857  between  him  and  the  Board  of  Police  Commissioners, 
amounting  in  all  to  $172,098.11  for  their  salaries  for  three  years  from 
1857  to  i860. 

No  service  was  ever  rendered  by  them  during  this  period ;  how 
many  other  policemen  are  behind,  waiting  the  result  of  these  claims, 
the  Comptroller  is  unable  to  state. 

The  same  schedule  embraces  a  portion  of  the  claims  for  "  Rents  of 
Armories,"  many  of  them  under  leases  made  by  the  Ring  Board  of 
Supervisors  at  exorbitant  rentals.  The  rents  reserved  in  these  leases 
for  the  whole  term  amount  to  nearly  two  million  dollars.  The  claims 
under  them  have  been  resisted  by  the  Comptroller  as  invalid,  as  in  the 
case  of  Glass  Hall,  on  which  suit  was  brought ;  the  ground  taken  by 
him  has  been  sustained  by  a  decision  of  the  Supreme  Court  in  favor  of 
the  City.  The  Glass  Hall  lease  was  made  by  the  Board  of  Supervisors 
in  December,  1872,  at  an  extravagant  rent,  and  as  it  was  not  needed, 


17 


the  building  was  never  occupied.  The  rent  was  $10,000  per  annum, 
with  taxes,  while  it  was  not  worth  half  that  amount. 

In  the  schedule  of  unadjusted  claims  is  included  a  statement  of 
awards  in  various  street-opening  proceedings,  amounting  to  $1,746, 
400.34,  the  main  portion  being  for  opening  and  widening  Kingsbridge 
Road,  recently  filed  in  this  Department,  and  although  in  many  cases 
these  are  believed  to  be  extravagant  in  amount,  having  -been  confirmed 
by  the  Supreme  Court,  their  payment  must  be  provided  for. 

On  December  31,  1874,  there  remained  in  the  hands  of  the  City 
Chamberlain  moneys  deposited  with  him  for  the  payment  of  interest 
due  on  stocks  and  bonds,  which  had  not  been  called  for,  amounting  to 
$73,487.08. 

There  are  heavy  City  liabilities  on  account  of  a  large  number  of 
pending  contracts  for  street  improvements,  supplies,  etc. ,  to  the  vari- 
ous Departments.  A  list  of  contracts  of  the  Corporation,  filed  in  the 
Department  of  Finance  during  the  year  1874,  with  statements  of  pay- 
ments made  thereon  up  to  December  31,  1874,  is  in  course  of  prepa- 
ration, and  will  be  submitted  to  the  Board  of  Aldermen,  as  required 
by  ordinance,  as  soon  as  completed. 

Testimony  taken  before  the  Commission  on  Contracts,  in  1872, 
indicates  how  the  passage  of  ordinances  of  the  Common  Council, 
authorizing  wooden  pavements,  etc.,  was  formerly  obtained.  One 
witness  testified  that,  as  he  desired  to  procure  certain  contracts  for  the 
paving  of  streets,  he  had  paid  $60,000  to  a  person  who  claimed  to  have 
influence  with  the  Common  Council,  and  could  secure  the  passage  of 
the  necessary  ordinances.  Persistent  efforts  were  made  in  the  Legis- 
lature to  confirm  these  ordinances,  and  saddle  millions  upon  the  City 
for  worthless  wooden  pavements,  which  were  defeated  only  by  the 
most  determined  resistance. 

Previous  to  the  accession  of  the  present  Comptroller  to  office, 
advances  had  been  made  from  the  Treasury  of  more  than  seven  hun- 
dred thousand  dollars  for  the  erection  and  completion  of  the  New 
Court-house-building,  which  amount  of  over-drafts  is  regarded  in  the 


i8 


nature  of  a  claim,  to  be  reimbursed  to  the  Treasurer  by  the  issue  of 
stock  forming  a  part  of  the  permanent  debt. 

Under  resolutions  formerly  passed  by  the  Common  Council,  donat- 
ing to  various  institutions,  principally  to  churches,  the  amounts  for 
which  they  were  assessed  on  local  improvements,  large  arrears  of  assess- 
ments have  not  been  paid,  and  will,  therefore,  constitute  claims  against 
the  City. 

It  is  proper  to  remark  that  many  existing  claims,  even  though  they 
may  have  some  degree  of  equity,  cannot  be  paid  by  the  Comptroller, 
for  various  reasons.  A  large  number  belong  to  that  class  of  old  claims 
incurred  by  the  Departments  when  expenditures  were  made  in  excess 
of  appropriations,  and  the  Comptroller  is  forbidden,  by  express  pro- 
vision of  law,  from  recognizing  their  legality. 

A  clamor  against  the  Finance  Department  has  been  gotten  up  by 
holders  of  fraudulent  claims  and  fostered  by  certain  unprincipled 
newspapers,  on  the  charge  of  delay  in  the  adjustment  and  payment  of 
bills  incurred  by  the  various  City  Departments.  This  is  without  just 
cause  as  respects  the.  great  bulk  of  the  immense  number  of  accounts 
and  vouchers  audited  by  the  Finance  Department. 

Their  average  time  during  1874,  for  passing  through  the  Depart- 
ment from  the  date  of  receipt  to  the  date  of  payment,  including  all 
classes  of  claims  and  liabilities  for  contracts  and  supplies,  is  less  than 
four  days. 

Doubtless  there  are  occasionally  just  claims,  tor  which  no  legal 
provision  has  been  made,  that  are  delayed,  but  the  general  fact  is 
indisputable,  that  claims  that  are  delayed  are  generally  those  the 
merits  and  justice  of  which  are  not  readily  ascertainable. 

It  must  not  be  supposed  that  no  efforts  have  been  made  to  dispose 
of  old  claims  without  intervention  of  the  courts.  More  than  four  mil- 
lions of  dollars  in  amount  have  been  adjusted  in  the  Finance  Depart- 
ment and  paid.  Where  the  claimant  refuses  to  accept  the  adjustment 
proposed,  the  Comptroller  is  unable  to  compel  him  to  do  so,  and 
delay  and  possibly  suit  occurs. 

The  City  of  New  York  is  no  exception  to  other  governmental  agen- 


l9 


cies  in  respect  to  unsatisfied  claimants.  In  all  governments,  claimants 
are  sometimes  compelled,  however  equitable  their  claim  may  be,  to 
wait  till  the  necessary  legislation  is  obtained  to  authorize  the  paying 
officers  to  recognize  their  demands.  This  is  a  necessary  incident  to 
the  existence  of  society.  It  is  not  always  possible  to  foresee  the  future 
needs  of  a  community,  and  exceptional  cases  of  delay  will  naturally 
occur ;  but  of  course  these  should  be  reduced  to  the  minimum. 

The  current  claims  for  which  value  has  been  given  to  the  city, 
are  and  have  been  recognized  and  promptly  liquidated.  The  other 
class  of  claims  for  which  no  value  has  been  given,  which  were  con- 
ceived in  the  lobby  and  are  held  and  promoted  by  that  disreputable 
class,  who  are  enabled  by  craft  and  cunning  to  live  without  labor,  out 
of  the  earnings  of  honest  and  industrious  men,  have  no  foundation 
either  in  justice  or  in  equity.  The  courts  ought  to  find  some  ground 
for  discrimination  against  them,  and  every  agency  of  the  government 
should  be  prompt  to  intercept  their  progress  to  the  door  of  the  treasury 
and  to  frustrate  and  defeat  them. 

Why  should  the  taxpayers  of  this  City,  and  by  the  taxpayers  I  do 
not  refer  alone  to  that  class  to  whom  the  payment  of  a  thousand 
dollars,  more  or  less,  involves  no  diminution  of  comforts,  but 
especially  to  those  less  favored,  who  in  these  times  of  depression  find  it 
difficult  to  keep  the  wolf  from  the  door,  and  to  maintain  a  roof  over 
the  head  of  their  families — why  should  these  have  their  frugal  earnings 
diminished  to  pay  a  monstrous  class  of  fraudulent  claims,  for  which  no 
value  has  been  given,  and  which  are  principally  held  by  public 
leeches,  who  have  never  done  an  honest  day's  work  in  their  lives  ? 

-  Why  should  the  industrious  mechanic,  or  poor  widow,  engaged  in 
a  constant  struggle  for  the  means  of  existence,  be  called  upon  to  pay 
an  increase  of  taxes  in  order  that  a  Purser,  or  a  Palmer,  or  a  Hastings, 
or  a  Sweeny,  or  a  Boyle,  or  a  Bennett  may  thrive  upon  moneys 
drawn  without  adequate  consideration  from  the  Public  Treasury  ? 

There  are  men  among  us  who  are  now  marshalling  the  influence, 
the  ingenuity  and  the  greed  of  attorneys,  lobbyists,  and  journalists,  to  get 
from  the  Treasury,  on  single  claims,  without  value  rendered,  amounts 


20 


that,  if  distributed  for  honest  service,  would,  in  these  pinching  times, 
gladden  the  hearts  of  a  whole  community. 

Is  there,  in  the  whole  machinery  of  justice,  no  process  by  which 
such  wrongs  can  be  prevented  ?  Must  the  whole  train  of  precedents 
be  harnessed  to  the  service  of  the  idle,  the  crafty,  and  the  depraved 
against  the  frugal  and  industrious. 

In  my  official  action  I  shall  not  cease  to  recognize  the  rights  of 
those  who  have  rendered  a  fair  equivalent  for  the  amount  they  seek  to 
obtain,  and  every  energy  that  I  possess  shall  be  exercised  to  defend  the 
trust  which  I  have  been  set  to  protect  against  depredators,  whether  in 
the  garb  of  seeming  respectability,  or  that  of  corrupt  or  dishonest  con- 
spirators. 

V. — The  Amount  of  the  Judgments  obtained  against  the  City 
during  his  term  of  office,  with  the  costs  taxed  upon 
the  City. 

From  September  16,  187 1,  when  the  present  Comptroller  took 
office,  to  December  31,  1874,  a  period  of  more  than  three  and  a  quarter 
years,  the  total  number  of  judgments  obtained  against  the  City,  includ- 
ing costs  taxed  upon  the  City,  was  844,  including  272  for  vacating 
assessments,  amounting  to  $1,935,389.04,  in  which  sum  was  included 
for  costs,  $63,082.28. 

Five  hundred  and  seventy  of  these  judgments,  amounting  (including 


costs,  $45,831.97)  to   $i,37l,38o  73 

Or  about  two-thirds  of  the  whole  in  number  obtained,  and  more 

than  one-half  in  amount  are  on  causes  of  action  originating 

prior  to  the  present  Comptroller's  accession  to  office. 
Forty-three  of  them  are  for  salaries  of  Supervisors  in  addition  to  their 

salaries  as  Aldermen,  amounting  to   13,987  S2 

Fifty-six  are  for  wages  of  Boulevard  men,  supposed  to  have  been 

illegally  employed,  amounting  to   8,819  *8 

One  hundred  and  seventy-five  are  miscellaneous,  amounting  to   541,201  31 

Total   $1, 935,389  04 


21 


Judgments  obtained  in  favor  of  the  City  are  not  included  in  these 
amounts. 

The  character  of  some  of  the  above  judgments  will  be  seen  by  the 
following  explanations  : 

The  forty-three  judgments  for  salaries  of  Supervisors,  in  addition  to 
their  salaries  as  Aldermen,  were  given,  notwithstanding  an  express 
|  prohibitory  provision  of  law  to  the  contrary. 

The  Charter  of  1873,  section  4,  provides  that  "  the  Aldermen  shall, 

•  •  from  the  time  of  the  passage  of  this  act,  be  the  Supervisors  of  the 
' '  Count}*  of  New  York, " 

Section  114,  of  the  same  instrument,  provides  that  •'•no  person  shall 

•  •  hold  two  City*  or  Count}-  offices  except  as  expressly  provided  in  this 

•  •  act.  nor  shall  any  officer  under  the  City  Government  hold  or  retain 
1  •  an  office  under  the  County  Government,  except  when  he  holds  such 
'  •  office  ex-officio  by  virtue  of  an  act  of  the  Legislature  ;  and  in  such 
'■case  he  shall  draw  no  salary  for  such  ex-officio  office." 

No  appropriation  was  made  by  the  Board  of  Apportionment  to  meet 
this  class  of  expenditures,  because  of  the  above  prohibitory  provisions 
of  law  :  yet  forty-three  judgments  have  been  obtained. 

We  look  in  vain  among  the  recipients  of  double  salaries  as  Alder- 
men and  Supervisors  for  the  respected  name  of  Oswald  Ottendorfer. 
He  alone  of  the  Board  of  which  he  was  a  member  denounced  the 
receiving  of  double  salaries  as  illegal  and  wrong. 

Judgments  were  given  against  the  City- of  over  $100,000,  for  paving 
New  Church  street  and  South  Fifth  avenue  with  a  patent  stone-block 
pavement.  These  works  were  done  under  special  contracts,  made  by 
the  Department  of  Public  Works  with  one  Charles  Guidet,  and  at  the 
exorbitant  price  of  $6  per  square  yard. 

A  bid  for  laying  similar  pavement  in  Newark  was  made  by  the 
same  Guidet,  at  $4.07  per  square  yard,  and  that  work  was  awarded  to 
another  party,  at  $2.87  per  square  yard. 

A  judgment  was  also  given  of  more  than  $130,000  on  the  contract 
for  paving  Seventh  avenue  with  a  wooden  pavement  in  1870,  made  by 


22 


William  M.  Tweed,  Commissioner  of  Public  Works,  with  Joseph  A. 
Monheimer,  late  Alderman. 

The  whole  amount  paid  for  this  scandalous  job  was  $433,000.  Its 
character  is  evidenced  by  the  present  utter  worthlessness  of  the  pave- 
ment. The  City  has  been  enjoined  from  collecting  the  assessments, 
and  the  whole  expense  is  thrown  upon  the  tax-payers  at  large. 

Can  tax-payers  and  property-holders  afford  to  pay  a  half  million 
dollars  for  a  pavement  that  is  rotted  out  in  less  than  three  years  ?  A 
fair  pavement  ought  to  last  for  a  generation  ;  there  are  now  in  this  City 
pavements  in  good  condition  laid  over  fifty  years  ago. 

Another  judgment  of  $366,926.80  was  obtained  by  the  Manhattan 
Gas-light  Company,  for  supply  of  gas  in  the  year  1871,  at  prices  which 
were  exorbitant.  The  Court  allowed  $45,  instead  of  $53  per  lamp, 
the  amount  charged,  thus  saving  the  City  the  sum  of  $63,000. 

It  is  quite  natural  that  the  shareholders  in  those  gas  companies, 
who  have  been  in  the  habit  of  receiving  from  30  to  50  per  cent,  per 
annum  in  dividends,  should  consider  the  Comptroller  an  obstruc- 
tionist. I  presume,  however,  tax-payers  will  not  object  to  that  sort  of 
obstruction  which  has  effected  a  reduction  in  the  cost  of  lighting  the 
streets  of  the  City,  as  shown  by  the  following  comparison  of  prices 
charged  per  lamp  per  annum,  in  1871  and  1874  :  • 


Com  pan  V. 

1871. 

1S74. 

Number  of 
Lamps. 

S53  00 

$33  00 

6,561 

New  York 

45  00 

33  00 

3,010 

Metropolitan     11  44   

53  00 

39  00 

3.488 

Harlem            "  "   

53  00 

39  00 

4,025 

N.  Y.  Mutual  " 

35  00 

5*3 

In  1871  the  cost  of  gas  was  about  $1,000,000,  and  in  1874  the 
saving  was  more  than  one-third  of  that  amount. 

It  will  be  seen  that  the  great  bulk  of  judgments  against  the  City 


23 


obtained  since  the  present  Comptroller  took  office  originated  in  trans- 
actions which  took  place  before  that  time,  in  an  era  of  unexampled 
official  corruption  and  reckless  extravagance.  They  grew  out  of  laws 
framed  by  conspirators  and  public  plunderers  in  their  own  interest. 
These  claims  very  generally  bore  the  badge  of  fraud  and  official 
malversation,  but  being  apparently  contracted  under  some  color  of  law, 
they  have,  under  the  faintest  pretext  and  technicalities,  often  without 
equity  and  justice,  been  pressed  upon  Courts  under  the  prevailing 
influences  of  the  hour,  to  the  detriment  of  the  City  Treasury,  whose 
protectors  are  but  few. 

Laws  framed  to  promote  private  interest  at  the  public  expense  still 
remain  on  the  Statute  book,  giving  rise  to  unjust  claims  against  the 
City,  for  which  no  monetary  provision  is  made.  The  claimants,  and 
their  attorneys  practised  in  the  art,  knowing  that  their  claims  cannot  be 
paid  until  put  in  the  form  of  a  compulsory  judgment,  readily  resort  to 
this  favorite  method. 

But  the  fact  remains  to  be  stated,  that  notwithstanding  the  bulk  of 
rotten  claims  precipitated  upon  the  Comptroller  from  a  previous  regime, 
the  amount  of  judgments  obtained  against  the  City  during  his  adminis- 
tration is  less  by  one-third  than  it  was  during  the  previous  three  years. 
The  amount  of  judgments  and  costs  against  the  City  for  three  years 
prior  to  September  16,  187 1,  was  $3,221,821.95.  Amount  for  same 
period  since  September  16,  1871,  was  $1,935,389.04. 

VI. — The  Amount  saved  to  the  City  by  Litigation  during  the 

SAME  PERIOD  BY  DECISIONS  IN  ITS  FAVOR. 

The  judgments  obtained  against  the  City  within  the  last  three  years 
were,  as  has  been  stated,  very  generally  based  on  claims  of  fraudulent 
or  extravagant  character ;  it  therefore  became  the  duty  of  the  Comp- 
troller to  resist  such  as  were  not  clearly  exempt  from  any  objections  of 
this  sort.  The  courts  of  this  City  are  maintained  out  of  the  public 
treasury,  at  the  cost  of  more  than  one  million  of  dollars  per  annum. 
They  are  furnished  with  criers,  clerks,  attendants,  juries,  and  all  the 
means  of  ascertaining  the  truth  ;  they  can  summon  witnesses  and 


24 


punish  them  for  false  testimony.  The  City  is  provided  with  a  Law 
Department,  having  a  retinue  of  counsel,  clerks,  and  assistants,  main- 
tained at  a  cost  of  nearly  two  hundred  thousand  dollars  per  annum. 
Cases  against  the  City  are  by  law  given  a  preference  before  all  other 
cases,  and  are  speedily  reached.  What  is  all  this  machinery  of  courts 
and  lawyers  paid  by  the  City  for,  unless  it  be  to  act  in  just  such  emer- 
gencies as  have  arisen  ?  It  is  the  business  of  the  courts  to  examine 
and  determine  upon  the  legality  of  these  claims.  That  is  what  they 
are  constituted  for. 

In  suits  decided  in  favor  of  the  City  since  September  16,  1871, 
either  the  Court  decided  against  the  whole  claim,  or  reduced  it,  or  the 
suit  has  been  discontinued  and  abandoned.  In  some  instances  an 
appeal  from  the  decision  has  been  taken.  The  whole  amount  of 
saving  in  these  suits  thus  far  is  $2,456,632.28.  If  the  Comptroller 
had  possessed  the  power  to  adjust  and  pay  old  and  doubtful  claims, 
and  the  same  appliances  to  ascertain  the  truth,  fewer  of  these  claims 
would  have  found  their  way  to  the  courts,  to  the  corresponding  advan- 
tage of  the  treasury.  It  is  proper  to  add  in  this  connection,  that 
besides  the  saving  to  the  City  by  litigation,  the  amount  saved  by 
reductions  and  abatements  since  September  16,  1 871 ,  on  claims  that 
were  adjusted  in  the  Finance  Department  without  the  intervention 
of  the  courts,  is  $856,912.87. 

The  following  statement  shows  the  total  saving  effected  during  the 
administration  of  the  Comptroller  to  December  31,  1874  : 

On  suits  thus  far  decided  in  favor  of  the  City   $2,456,632  28 

On  claims  adjusted  in  the  Department   856,912  S7 

Total  savings   $3* 3 ^ 545  l5 

Besides  this,  these  litigations  have  often,  on  a  claim  of  small  amount, 
determined  principles  that  will  defeat  similar  claims  to  a  large  amount. 
Such  advantages  and  savings  are  not  included  in  the  above  figures. 

The  Courts  decided  against  one  newspaper  claim  of  about  $3,000  in 
favor  of  the  City,  and  with  this  decision  fell  claims  for  more  than  three 


hundred  thousand  dollars  of  similar  character.  In  one  suit,  in  an 
armory  lease,  involving  $15,000,  the  decision  in  favor  of  the  City  will, 
if  sustained  in  the  higher  courts,  carry  a  million  and  a  half  of  dollars 
of  this  class  of  rents. 

All  legal  actions  to  which  the  City  is  a  party  are  conducted  by  the 
Law  Department,  and  upon  the  Corporation  Counsel  rests  the  respon- 
sibility of  prosecuting  or  defending  them.  In  those  cases  where,  at  the 
Comptroller's  instance,  special  counsel  have  been  retained,  every  case 
which  has  been  decided  has  had  a  successful  issue. 

VII. — The  Amount  of  the  Bonds  and  Stocks  of  the  City 
created  by  authority  of  the  state  legislature  and  not 
Asked  for,  or  Approved  by  the  Common  Council  or  the 
Board  of  Supervisors,  and  the  Amount  Approved  or  Asked 
for  by  the  corporate  authorities  of  this  clty  and  the 
late  County  Authorities,  respectively. 

1.  Bonds  and  stocks  issued  by  authority  of  the  Legislature, 

and  approved  by  the  Common  Council  of  the  City  of 

New  York,  amounting  to   $38,777,02600 

2.  Bonds  and  stocks  issued  by  authority  of  the  Legislature. 

and  approved   by  the  Board  of  Supervisors  of  the 

County  of  New  York,  amounting  to   18, 124, 304  46 

3.  Bonds  and  stocks  issued  by  authority  of  the  Legislature, 

and  not  asked  for  or  approved  by  the  Common 
Council  or  Board  of  Supervisors  of  the  City  and  Coun- 
ty of  New  York,  amounting  to. .  .  ;   84,902,427  54 

$141,803,758  00 

Schedule  "  D "  presents  detailed  statements  of  the  issues  of 
stocks  and  bonds  which  have  been  made  under  the  three  kinds  of 
authority  above  distinguished. 

Prior  to  1864,  all  stocks  and  bonds  were  issued  by  authority  of 
the  Common  Council  or  the  Board  of  Supervisors  under  acts  of  the 
Legislature  passed  upon  the  application  of  the  Corporate  authorities. 


26 


This  practice  was  discontinued  at  that  date,  and  the  power  to  issue 
stocks  and  bonds  was  conferred  by  the  Legislature  upon  the  Comp- 
troller, subject  to  the  requisition  of  officers  of  Boards  and  Departments 
having  various  public  works  in  charge.  The  reason  for  this  deviation 
from  the  former  practice  appears  to  have  been  that,  when  the  power  to 
authorize  the  issue  of  stocks  and  bonds  was  given  to  the  Common 
Council,  members  of  that  body  often  refused  to  comply  with  the  law, 
and  occasioned  delays  in  the  issues  necessary  to  cany  on  improve- 
ments until  the  officers  charged  with  their  execution  would  give  these 
members  appointments  or  otherwise  satisfy  their  demands.  This 
practice  caused  so  much  embarrassment  that  a  remedy  was  sought  at 
the  hands  of  the  Legislature,  and  authority  obtained  for  a  single 
officer  to  issue  stocks  and  bonds,  instead  of  calling  into  requisition  a 
multitudinous  Common  Council.  Neither  the  Common  Council  nor 
the  Comptroller  can  now  issue  stocks  or  bonds  without  authority  from 
the  Legislature,  but  no  authority  to  issue  bonds  on  the  credit  of  the 
City  should  be  granted  by  the  Legislature  unless  specifically  asked  for 
by  the  officers  of  the  City,  and  this  authority  once  obtained,  under 
proper  amendments,  the  fewer  intermediate  parties  there  are  to  be 
consulted  the  better  for  the  public  interests. 

The  local  authority  which  now  takes  the  place  of  the  Common 
Council  in  authorizing  the  issue  of  bonds  from  time  to  time,  as  needed, 
is  the  Board  of  Estimate  and  Apportionment.  This  Board  has  been 
established  by  a  number  of  recent  enactments  in  and  since  187 1,  and 
acts  in  the  issue  of  stocks  and  bonds  authorized  by  the  Legislature. 
There  has  been,  and  there  is  now,  a  lack  of  system  in  this  matter, 
opening  the  door  to  the  mischievous  practice  of  heads  of  Depart- 
ments, and  other  public  officers,  taking  a  direct  and  active  part  in 
lobbying  through  the  Legislature  special  acts  of  authority  to  issue  stocks 
or  bonds,  to  be  applied  to  purposes  in  which  they  were  personally 
interested,  without  any  consultation  with  the  Financial  Department  or 
Common  Council. 


27 


VIII. — The  Amount  of  Unpaid  Taxes  and  Assessments  up  to 
December  31,  1874,  and  the  Amount  of  Assessment  Bonds 
Outstanding  at  the  Same  Date. 

Schedule  "  E  "  exhibits  a  yearly  statement  of  taxes  on  real  an^ 
personal  estate,  remaining  unpaid  on  December  31,  1874,  from  the 
year  1841,  thirty-four  years,  amounting  in  the  aggregate  as  follows : 

Unpaid  Taxes  on  Real  Estate  prior  to  and  including  1873   $4,023,036  38 

'*        "        Personal  Estate  prior  to  and  including  1873   9,644,91364 

"        "        Real  and  Personal,  1874   6,178,874  71 

Total  819,846,824  73 

The  unpaid  taxes  on  real  estate  are  a  lien  on  the  property  assessed, 
and  will  be,  in  the  main,  ultimately  collected. 

Sales  of  property  have  been  made  for  unpaid  taxes  down  to  the 
year  1870,  but  there  are  many  items  of  taxes  unpaid  in  former  years, 
which,  for  various  reasons,  have  not  been  included  in  the  sales  for 
taxes,  and  still  appear  on  the  records  as  unpaid.  A  very  large  amount 
of  personal  taxes  remaining  unpaid  will,  however,  be  lost  to  the  City, 
as  the  parties  against  whom  they  stand  cannot  be  found,  or  have  no 
property  whatever.  It  will  be  seen,  by  reference  to  said  Schedule  "  E," 
that  the  deficiencies  in  the  product  of  personal  taxes  have  increased 
immensely  within  a  few  years  past.  There  are  defects  in  the  mode  of 
assessing  personal  taxes  which  should  be  corrected  to  obviate  this  very 
serious  evil. 

Chapter  293,  Laws  of  1861,  provided  that  "it  shall  be  the  duty  of 
"the -Board  of  Supervisors  to  include  in  any  and  every  ordinance  or 
"  resolution  passed  by  them  imposing  and  levying  taxes  for  any  purpose 
"  or  purposes  authorized  by  law,  within  the  City  and  County  of  New 
'*  York,  such  sum,  in  addition  to  the  aggregate  amount  required  for 
"  such  purposes,  as  they  shall  deem  necessary,  not  exceeding  three  per 
"  cent,  of  said  aggregate  amount,  to  provide  for  deficiencies  in  the 
"  actual  product  of  the  amount  imposed  and  levied  therefor." 

Under  the  operation  of  this  provision  "  the  deficiencies  in  the 
"  actual  product  "  were  fully  met  and  provided  for  by  the  sums  added 


28 


annually  by  the  Board  of  Supervisors,  up  to  and  including  the  year 
1870;  but  under  the  fraudulent  and  deceptive  "Ring"  tax  levy 
imposed  by  the  Legislature  in  chapter  583,  Laws  of  187 1,  by  which 
the  amount  of  taxes  levied  was  limited  to  two  per  cent,  on  the  valua- 
tions, it  was  construed  as  repealing  this  deficiency  provision  and,  there- 
fore, that  no  authority  of  law  existed  to  provide  for  deficiencies  in  the 
product  in  the  years  1871  and  1872;  and  the  actual  deficiency  from 
unpaid  taxes  alone  in  those  two  years  amount  to  upwards  of  two 
millions  and  a  half  dollars. 

Chapter  756,  Laws  ot  1873,  re-enacted  the  same  provision  as  the 
Act  of  1 86 1,  making  it  the  duty  of  the  Board  of  Supervisors  to  add 
such  a  sum,  not  exceeding  three  per  cent,  of  the  aggregate  amount 
required;  and  in  1873  the  sum  of  $807,502.80,  or  nearly  three  per 
cent.,  was  added  j  but  the  unpaid  personal  taxes  of  that  year  alone 
amounted  to  $1,108,770.87. 

The  Board  of  Supervisors  of  last  year  (1874),  against  the  wish  of  the 
Comptroller,  added  only  $490,425.13,  or  only  about  one-half  of  the 
three  per  cent.,  for  deficiency  allowed  by  law,  and  which  should  have 
been  added,  thus  failing  to  provide  for  the  actual  deficiency  in  the  pro- 
duct of  the  Tax  Levy  which  obviously  would  occur  for  that  year.  Such 
a  course  of  action  might  deceive  the  public  by  lowering  the  rate  of 
taxation,  but  it  also  causes  a  deficiency  which  must  be  met  by  an  in- 
crease of  the  public  debt,  or  by  future  taxation. 

Schedule  "  E  "  exhibits  a  statement  of  unpaid  assessments  on  prop- 
erty benefited  by  local  improvements,  with  the  years  in  which  they 
are  respectively  confirmed.  The  total  amount  remaining  unpaid 
December  31,  1874,  is  as  follows: 


Bureau  of 
Collection  of 
Assessments. 

]  Hneau 

of 
Arrears. 

Total. 

Assessment    Fund  —  Opening 

Street   Improvement   Fund — 
Regulating,  grading,  etc. .  . 

$402,745  00 
2,092,876  04 

$2,287,051  64 
2,823,827  67 

$2,686,796  64 
4,916,703  71 

$2,495,621  04 

$5,110,879  31 

$7,606,500  35 

29 


Sales  of  property  have  been  made  for  arrears  of  assessments  con- 
firmed by  the  Supreme  Court,  up  to  and  including  the  year  1870,  and 
a  list  of  property  for  street  improvements  up  to  the  same  date  is  now  in 
course  of  preparation.  Three  years,  in  cases  of  assessments  and  taxes, 
must  elapse  before  collections  can  be  enforced  by  sale. 

The  amount  of  assessment  bonds  outstanding  December  31,  1874, 
as  will  be  seen  under  the  proper  head,  is  $20,851,000.  This  class  of 
debt  should  be  strictly  limited,  as  I  have  constantly  recommended, 
by  some  provision  of  law,  fixing  a  maximum  of  issues  of  assessment 
bonds.  If  no  limit  be  set  to  their  issue,  there  will  be  no  limit  to 
wasteful  and  extravagant  expenditures  for  unnecessary  and  costly  local 
improvements. 

The  outstanding  assessment  bonds  are  represented  by  the  following 
items  : 

Advances  to  contractors  .  „   $5,712,739  21 

Advances  on  boulevard  work   7,531,477  42 

Uncollected  assessments   7,606,50x3  35 

Total   $20,850,726  98 


Schedule  "F"  exhibits  the  balance  sheet  of  the  General  Ledger  of 
the  Finance  Department,  at  the  end  of  the  year  1874. 

In  the  summer  of  1871  the  credit  of  the  City  received  a  severe 
shock  by  the  exposure  of  the  enormous  frauds  committed  on  the 
treasury  by  the  notorious  officials  then  in  power.  Capitalists  were 
justly  alarmed,  and  City  securities  were  seriously  depressed.  Confi- 
dence has  since  been  wholly  restored,  the  credit  of  the  City  is  now 
unimpaired,  and  its  securities,  which  are  rated  at  a  high  premium,  are 
sought  after  for  investment  by  the  most  prudent  capitalists  and  trust 
institutions. 


30 


During  the  present  Comptroller's  administration  the  entire person?iel 
of  the  City  Government  has  been  changed,  in  some  Departments  more 
than  once,  and  another  change  has  actually  commenced.  Inex- 
perienced men  have  come  into  office,  who  have  to  pass  through  the 
process  of  educating  themselves  for  their  duties ;  it  is  erroneous  to 
suppose  that  important  public  trusts  can  be  either  intelligently  or 
efficiently  administered  by  new  officials  without  experience  in  the  busi- 
ness they  are  called  upon  to  manage. 

The  average  politician  makes  but  a  poor  administrator  of  respon- 
sible affairs,  and  the  public  interest  must  correspondingly  suffer.  Such 
persons  are  not  apt  to  be  very  careful  accountants  or  rigid  economists, 
and  it  is  no  small  task  for  the  Finance  Department  to  bring  them  to 
consent  to  necessary  and  methodical  systems  of  business. 

During  the  same  period  a  new  Charter,  with  entirely  novel  powers, 
has  come  into  operation,  underlying  and  affecting  every  transaction  of 
the  government. 

The  business  of  the  City,  conducted  by  very  many  agents,  has  had 
to  be  adjusted  and  systematized,  as  rapidly  as  was  practicable,  accord- 
ing to  its  provisions. 

Again,  an  act  of  annexation  has  been  passed,  nearly  doubling  the 
City  territory  and  raising  innumerable  causes  of  complication. 

To  crown  all,  amendments  have  been  added  to  the  Constitution  of 
the  State,  which  have  created  numberless  questions  respecting  appro- 
priations and  the  payment  of  moneys. 

These  changes  and  complications  in  the  City  government  have 
immensely  increased  the  responsibilities  and  labors  of  the  Finance 
Department,  without  corresponding  recognition  and  provision  to  meet 
them. 

Although  the  time  for  the  preparation  of  the  mass  of  statistics  pre- 
sented with  this  report  has  been  very  short,  yet  I  have,  I  believe,  given 
all,  and  perhaps  more  than  all,  the  information  that  was  asked.     It  is 


31 

but  a  brief  epitome  of  an  earnest  struggle  of  more  than  three  years  of 
official  life,  to  bring  the  affairs  of  this  community,  so  sadly  astray, 
back  to  better  ways. 

To  the  completion  of  the  work,  which  I  am  aware  is  but  partially 
accomplished,  I  shall  welcome  the  aid  of  any  agencies,  whose  object  is 
singly  and  honestly  to  bring  about  results  that  the  better  portion  of- 
this  community  will  approve. 

Respectfully  submitted, 


AND.  H.  GREEN, 

Comptroller^ 


